Estate PlanningWills and Trusts each have their Advantages and Disadvantages. For example, a Will allows you to name a guardian for your children and to specify funeral arrangements, while a trust does not. On the other hand, a Trust can be used to plan for disability or to provide savings on taxes.
A WILL (Last Will and Testament):
- Passes through probate
- Become a matter of public record when they’re submitted to the court for probate
- Allows you to name a guardian for your children
- Specify funeral arrangements
- Goes into effect after you die
- Directs who will receive your property at your death
- Appoints a legal representative to carry out your wishes
- Covers any property that is solely in your name at the time of your death
- DOES NOT cover any property held in joint tenancy or in a trust
- If you die without having made a will, you have died intestate. In that case, the court will distribute your property and determine the beneficiaries. Further, without the guidance of a will, the court will name the guardian for your minor children.
LIVING WILLA living will bears no relation to a conventional will and is not used to leave property at death. A living will is a document that allows you to state what type of medical treatment you do or do not wish to receive should you be too ill or injured to communicate your wishes.
POUR-OVER WILLA pour-over will “pours over” property into a trust when you die. Property left through the will must go through probate before it is placed into the trust.
- A trust takes effect as soon as you create it
- Can be used to begin distributing property before death, at death or afterwords
- Covers only property that has been transferred into the trust
- Passes outside of probate and remains private
- Can be used to plan for disability or to provide savings on taxes